Demand rises for Chinese-made chips

Chinese demand for locally designed semiconductors is increasing to meet the needs of electronic equipment makers, InformationWeek reported, citing a market research firm. By 2012, US$42.1 billion in Chinese-designed semiconductors will be bought for use in China, up 63.8% from $25.8 billion in 2007, according to iSuppli. This reflects a drop in manufacturing outsourcing to China by foreign electronic equipment makers. Most demand comes from Chinese and Hong Kong-based electronics manufacturers. Mobile handsets are expected to be the largest user of Chinese semiconductors, consuming US$9.8 billion worth of domestically designed chips by 2012, more than double the amount in 2007, iSuppli said. China’s total use of semiconductors is expected to rise to US$81 billion this year, a 7% increase from 2007, iSuppli said.